Why I was tempted to discriminate against women

It may seem odd to be writing about women’s employment and maternity rights in a blog dedicated to the business of games, but I make no apology. It is a fundamental issue that has already sparked debate in the technology world and will become more important in games as our industry matures (and as more developers become publishers).

Prospect magazine this month carried an article entitled The mother of all paradoxes which produces compelling evidence that generous maternity rights lead to systemic discrimination against women. As a former startup CEO, I fear Prospect is right.

The moral case for maternity rights seem clear to me, but if they achieve the opposite effect to that intended, is the conclusion clear cut?

And even I as I put forward the arguments, I find that I can’t make up my mind, and I need your help.

Catherine Hakim’s argument in Prospect can be summed up like this (although I urge you to read it for yourself. The arguments are much more sophisticated and are backed up by more research than I can précis here. Unfortunately, it’s behind a paywall – a sort-of summary can be found in this opinion column from the Telegraph):

The law penalises employers for not keeping a role open for a woman on maternity leave, while the mother can quit at any time with no penalty.

Only about half of women return to their previous jobs, a figure largely unchanged since maternity protection was introduced in the 1970s.

Sixty per cent of women signalled their intention to return to work, but research suggests that two-thirds of those that pledge to return had no intention of doing so (I struggle to reconcile this point with the previous one).

The impact on businesses can be substantial as “women in senior professional and managerial roles cannot always be easily replaced.”

Evidence from Sweden suggests that “family-friendly employment policies have been the cause of the glass ceiling for women, not the solution to it” (my emphasis). “Onerous maternity protection leads the private sector to systematically avoid hiring women, who then mostly work in the less well-paid public sector”.

Research has suggested that maternity leave of of around three to four months helps women’s employment but longer periods lead to what economists call ‘statistical discrimination’ against women in general.

In short, extending maternity rights can cause sufficient headaches for businesses to prompt blanket discrimination against women, except in the public sector.

My hiring experiences

As a vice-president at Deutsche Bank, I was involved in interviewing candidates for graduate roles in the Media Corporate Finance division. I am convinced that I had no gender bias, and the media team had one of the higher proportions of female to male graduate recruits in the division.

The thought of maternity issues never crossed my mind. Even if they had, Deutsche Bank could easily have afforded to pay generous maternity rights, although Prospect says that “some private sector employers – especially in the City – take the view that it is cheaper in time and money to dismiss a pregnant woman and pay compensation, so that a permanent replacement can be appointed immediately.”

As CEO of GameShadow, the thought did cross my mind. We were a small, struggling start-up with limited revenues. I wondered how we could cope if an employee became pregnant. It was not only the financial costs but the whole process and distraction of finding and training a temporary replacement that worried me.

I can’t say how reacted, because we didn’t get a single female applicant for any of the roles we advertised while I was there. (Why no women applied is a whole different subject for discussion, although since we were looking for technology staff in a hardcore PC gaming website, perhaps its not that surprising.)

The challenging paradox

I like to think I’m socially liberal. I believe maternity leave and working flexibility are something that should be available in a civilised society. (Full disclosure: I have a 12 month old baby; maternity rights have been important to me in the last year).

But the entrepreneur/start-up adviser in me is conflicted. Businesses benefit from a diverse workforce (ages, genders, ethnicities) and avoiding any one group eliminates a large pool of talent. But the risk of having a substantial portion of your workforce away on a legally-protected absence, preventing you from hiring and training a replacement or forcing you pay two salaries, is a huge burden to put on any business, let alone one built on such shaky foundations as a startup.

And if I worry about this, what will less scrupulous business people do? They’ll do what Catherine Hakim warns about and avoid “hiring or promoting younger women at all”.

Why this matters to game developers

The games industry is maturing. We are no longer an industry that attracts only games-obsessed men whose only interest is coding. Developers are becoming publishers, meaning they need marketers, finance teams, lawyers. In short, they need talent, and many of the best candidates are women.

Amongst my clients at the moment, there are women as head of studio and head of marketing. There are women in web design, in core coding, in finance and in art. Our industry is expanding and is no longer exclusively the preserve of men.

Companies who have previously only had a few women employees will move towards an equal split. But the issues I’ve highlighted above may put them off hiring the best candidates.

Why this matters now

(UPDATE: It was pointed out to me that the Equalities Bill doesn’t, in fact, include extending maternity rights. I blame Prospect, although it was ambiguous: “Her equalities bill follows Sweden’s lead, where maternity leave has been extended to three years and fathers are forced to take paternity leave.)

Harriet Harman is introducing an Equalities Bill that would extend maternity leave to three years. Catherine Hakim warns that this might be detrimental to the prospects of all women, although it may well be beneficial to mothers.

I’m already worried about the existing legislation. I don’t know what to think about this new bill. Will it help more than it will hurt? How do we reconcile family-friendly policies with the needs of business? How do we attract more women into games, technology and startups when the financial burden could (and I only mean could) be disastrous for an employer.

I don’t want to start a flame war but I want to open a discussion into an issue that has bothered me for three years now, on which I can’t make up my mind.

About Nicholas Lovell

Nicholas is the founder of Gamesbrief, a blog dedicated to the business of games. It aims to be informative, authoritative and above all helpful to developers grappling with business strategy. He is the author of a growing list of books about making money in the games industry and other digital media, including How to Publish a Game and Design Rules for Free-to-Play Games, and Penguin-published title The Curve: thecurveonline.com

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The only issue I take with youf comments, Yishay, is that in my experience (and I emphasise that this is anecdotal, not research-led), mothers are, in general, more reluctant to go back to work quickly than fathers. So I agree that ending discrimination in law is the most important thing. But we still have a cultural/biological challenge of allowing either parent to choose to be the primary carer.

A three year maternity leave law is sexist. It assumes that a good mum is a stay-at-home mum. It is also very backwards in terms of educational philosophy, assuming the best place for a child is at home.
Maternity rights in general are not the problem. Discriminations is rooted in the asymmetry in parental rights and duties. If the law would provide for a package of rights to be shared by both parents as they see fit, they there would be no grounds for discrimination. Of course, there is a degree of asymmetry dictated by biology, but that only holds for the fist 3-4 weeks after birth. From there on, a dad can provide as good a care as a mum.
As for the overall length, when they reach the age of 1, children already have sufficiently developed social skills to benefit from spending as much time possible in a peer group. Send them to a nice nursery and go to work.

the problem here is inequality. as in the bills themselves are unequal. there is an entire group of people who are not included in this bill. in fact _half the population_. why is it that only the women get leave? make it equal across the board and this problem disappears. now it's not 'i can't hire this women because she might get pregnant' this might provide a slight incentive against hiring younger people, but this is easily overcome with experience or talent.

this is after all how sweden and norway does it. so far they seem to have it right on discrimination. (except for recently with muslims).

Thanks for the comments, Mick, but I don't think Sweden's success is as clear cut as you make out.

Prospect says “A 2009 paper by Swedish economist Magnus Henrekson confirms that womena are much more likely to reach top executive positions in Anglo-Saxon countries – and especially the US, which has only 12 weeks unpaid maternity leave – than in Scandianavia… Forcing fathers to tak paternity leave, meanwhile, has done little to change sex-roles in Scandinavia.”

And

“The pay gap in Sweden fell from 33 per cent in 1968, before generous maternity protection was first introduced, to 18 per cent by 1981. But it as been rising gradually ever since then.”

In other words, Sweden is actually evidence that generous maternity benefits have not delivered equality for women.

I agree that calling it “parental leave” will be a big step forward, but the Swedish example shows that after 40 years, generous maternity benefits have not brought equality.

Mick

As a Swedish man I find it fascinating that the article discusses “maternity” leave and not parental leave, as we call it in Sweden. This is a situation affecting anyone wanting to raise their kids, not just mothers. Also, as a previous commenter said, it's a problem for the companies, not the people who make up the workforce. Without the workforce, companies are nothing. The problem isn't the parental leave, it's the view of parental leave as being a problem that is causing issues.

Reading this article made me fell like I was back in the 80's, I seriously thought it was a weird joke, the thinking is so backward to me.

Cultural differences I suppose.

stewartm0205

Everything exist to serve the whole. It is people believing insanity like that which is destroying us. I am trying to figure out if businesses can exist without workers or customers. The answer seems to be no. People can exist without businesses. So if seems that people are primary to businesses. The major reason for the diminishing population growth is most first world countries is this extremely negative bias towards working women.

The problem could be looked at from a different angle – in that why do employers believe that men are a better bet? Because they don't take long periods of maternity leave – that is the gist of the above argument.

However, if maternity leave were to be shared as each couple felt appropriate between them to a maximum period – it would deliver two clear benefits. Firstly – fathers would be entitled and encouraged to spend more time during that early period of having babies and perhaps would not be looked askance at for so doing – as it became more 'normal'. Employers would no longer be able to discriminate against women when taking on employees – as they would not know which parent would be claiming parental leave.

This is a very good post addressing what is a genuinely difficult issue – however – the solution should be about removing discrimination and enabling working people to have what is ultimately a relatively short period to nurture their offspring.

Exchangeable parental leave would greatly reduce inequality (except that when Dad's realised how hard it is, they'd probably all rush back to work:) The other issue that causes a glass ceiling is flexible working and our long hours culture. Look at any bank and see how many senior people get to leave at 5pm to see the children. Many working Mothers will choose to resign, or avoid promotion, rather than get home every day at 8pm and not see their child.

benatkin

You seem to be talking about the USA, while the article is about England.

Here we have a different problem: mothers who can't afford to take leave have to work anyway because the FML Act doesn't require employers to continue to pay them while on leave. Many of them can't afford childcare either. So grandma ends up watching them.

Renee

*In short, I think maternity leave should be mandatory – mothers should be forced to take at least three years leave to look after their kids.*

Whoa. Fascist. You're saying that if a women has a child under the age of three she should forcibly be prevented from working at any type of job?

DISQUS

FYI, what employers are paying women while they're on maternity leave? If the employer has 50 or more employees, it would be covered under FMLA, which is UNPAID leave and only guarantees that the mother can come back to work when the maternity leave is over (limited time frame on that as well – 12 weeks). The employer does NOT pay “two salaries” just because they hire someone else while the mother is out on leave.

For companies under 50 employees, FMLA doesn't even apply, so what federal regulations are forcing you to pay the mother while she is on leave?

DianeL

Interesting post Nicholas. I agree : cost of rearing children, who later benefit to the whole society (as consumers, workforce and taxpayers), should be supported by the entire society, not by individual businesses, but the decision to have and raise children (or take time off work for it) should be individual and not gender related.

Economists have found each extra year a woman waits in her 20s before having children increases her lifetime earnings by 10% : http://www.slate.com/id/2131645/?nav/tap3/. Also, many women who go back to work after having children only find low-status, low-paid part-time jobs.

The workplace is changing nonetheless, especially in tech sector, with more working from home and usage of collaborative distance tools. Tech indeed makes our work and private lives completely interconnected and the notion of working hours less relevant. Admittedly, the issue will remain for the birth itself (mothers can't outsource it to anybody else nor do it part-time) and the time just before and after, and be a problem for very small firms and short project-based positions, but I hope it will be less an issue in the future.

I'm sorry, but this is extremely stupid and short-sighted. Now women who decide to have kids will be *actively prevented* by the government from working? Yeah, I'm sure that's going to be beneficial.

MS

“In fact, child rearing is like national service or jury duty. It is one of those things we should all have to do for the benefit of our commonwealth.”

I'm sorry, what?!

Having children these days is a lifestyle choice, along with being religious, voting a certain way or supporting a certain football team.

I'm female and never want to have children. I'm extremely offended at the idea that it's my “duty” to breed and I am seriously pi$$ed at the idea that I'm being discriminated against career-wise based on the assumption that I have ovaries, therefore I must be planning to use them.

I agree with Catherine's view that the legislation would negatively affect all women's careers, even if it was good for mothers. But that's the point: Women =/= Mothers!

Never mind the women like me who choose not to have kids, this also leaves women who *can't* have children in the lurch. I suppose you think that they aren't fulfilling their duty to society too?

Matthew

The answer to me seems to be this:

If you want liberal maternity rights policy, then the risk needs to be spread evenly amongst companies large and small.

Increase corporation tax, and use it to pay for whatever maternity cover is required across the whole economy. Rather than have companies pay for it directly.

The way it's done at the moment puts a disproportionate burden on smaller companies, who aren't able to spread out the risk across a larger workforce.

Interesting post Nicholas. As a woman in my early 30s, I fear that Bill's like that proposed by Harriet “handsfree” Harman will further prejudice my chances in a difficult jobs market. In the digital sector, all firms are micro/SMEs, and one cannot help but worry that they will look at me and think I pose a risk of serving an expensive bun-in-the-oven to an employer – I certainly would as an employers. But it's never discussed, and it's not like you can go into an interview and say 'Don't worry! I hate the little b*ggers!' or whatever.

Parental leave is ultimately the most fair solution to allow the choice of parenting, benefiting both men and women and starting to thin the glass ceiling which sadly still exists in the tech sector.

I agree with some of your points (particularly the distinction between “returning to work” and “returning to their original jobs”), but one of Hakim's core arguments is not about whether women return to work, it's about the inequality of pay. And she argues “Onerous maternity protection leads the private sector to systematically avoid hiring women, who then mostly work in the less well-paid public sector”.

So it's not just about maternity rights. It's about whether equality legislation actually works to increase the gender pay gap, not decrease it.

I can't quite believe that anyone was quite as blunt as that shareholder you mentioned, but if someone is saying that out loud, you have to believe that many more people are thinking/acting like that. And I agree that it was convenient not to have to worry about it. I'm quite glad that I was never put in position at GameShadow.

I can see this falling down politically very quickly. How would you feel paying £3 million for a high-flying City banker not to work for three years? £1 million for a successful executive. Even I agreed that this was a good idea, I can't imagine the taxpayer, or politicians, going for it.

I can see this falling down politically very quickly. How would you feel paying £3 million for a high-flying City banker not to work for three years? £1 million for a successful executive. Even I agreed that this was a good idea, I can't imagine the taxpayer, or politicians, going for it.

wheatles

Hakim's article is making the point – which seems to be agreed with – that maternity provisions are structured in such a way as to incentivise people to choose a man over a woman when recruiting. She goes on to list some of the issues companies face when managing maternity provisions (which you re-print above) and then concludes that, because firms are less inclined to hire women, maternity provisions actually hurt them.

Problem is, the stats don't back this up. Over three decades of maternity provisions, the proportion of working age women employed has risen from 56 per cent in 1971 to 70 per cent in 2008. In 1988, 45 per cent of women who worked during pregnancy returned to employment after the birth of a child. By 1996, 67 per cent were returning within 10-11 months, and by 2004, 80 per cent returned to work 13-17 months after giving birth (the differences in months are due to differences in the survey data* – this data is sourced from the Department of Work and Pensions.

So we shouldn't confuse the issue of women returning to work with women *returning to their original jobs*.

This distinction is why Hakim seems to be off the mark when saying women are harmed by maternity provisions.

There is, I'm certain, a heavy burden on smaller firms in contrast to larger corporations – but the good news is, employers seem to be going against the incentives and continuing to employ women in increasing figures. I strongly agree that the way the current system is set up does not incentise employers in the right way – and I fully support the principle that the government is looking to introduce the ability to transfer leave provisions between mother and father. Interestingly, this is something that they have in the much piliorised (by Hakim) Swedish system – and, as a result, Sweden has one of the highest ratio of men:women who take up leave.

However, we shouldn't look at this provision as an opportunity to help out struggling small entrepreneurial firms (particularly in the tech space) – it's the male industries that will be hit hardest by more men taking up the provisions of leave…

*This is reprinted from an excellent article in the journal leftfootforward, written by Kate Bell from the Gingerbread organisation.

“Maybe if groups of local companies and staff got together and created clusters of childcare centres split the costs with payments deducted from wages but also a contribution from the employer it might help?!?!”

Childcare vouchers in lieu of salary might be a better option for SMEs. They're valid for existing registered nurseries, i.e., the company doesn't have to get tied up in the health & safety implications of running their own nurseries, which I think would put off the vast majority of SMEs, even working in a cluster.

Kevin

It is odd that this is so rarely mentioned. I've only ever worked for smaller companies (i.e. 1 – 150 employees) – even my more “blue chip” employment was with a subsidiary of a multinational, not the famous company itself – and I've been involved in hiring for 15 years, and I would bet that every one of those companies had someone who showed prejudice against women because of sexist laws and social expectations (i.e. anti-male parenthood laws, and anti-female expectations about family roles).

In one case I recall a shareholder at one privately held company telling me “you can hire anyone you want, but no women.” I think my reply was “I'm aware of the cost implications – you can rest assured that I'll do what's best for the company.” To some extent my answer meant “**** off”, and I hired a fair few women for that company. But on the other hand, I *was* aware of the financial implications, and it's convenient for me that I never looked at a candidate and thought “I would hire you, but I reckon you'll want a family…”

sandyd33

I think it's a great article and one that needed to be put out there! Being a woman with no children but a ticking clock, employer and web start up director, i think the issue of women returning to work would be a lot easier if childcare wasn't so expensive and also if friends or family didn't need to have a bloomin CBR's to look after a child. I'm all for child protection but if you can't trust your best friend or member of your family who can you trust!The nations been relying on grandparents for years looking after their grandchildren so their daughters can go back to work. The majority of women need to work not just financially but also for their self esteem and social integration. However most women are not on massive wages and the financial line to work or not to work is very thin. Good staff are worth their weight in gold and extremely difficult to replace. Maybe if groups of local companies and staff got together and created clusters of childcare centres split the costs with payments deducted from wages but also a contribution from the employer it might help?!?!

Dug, I think the problem with your suggestion is the assumption that the woman will always want to intensively mother the children. This isn't always the case and some families don't work like that. Any sort of “mandatory” arrangement could be potentially very damaging to individuals who don't fit into these assumptions. In fact, this typifies why liberals object, on principle, to mandatory solutions.

Mmmmm well, I know it sounds counter-intuitive, but as global population growth accelerates, European countries increasingly become irrelevant. In fact, at current rates, countries like Italy soon won't have any children (OK need to check that fact)…

While it would be silly to suggest that “businesses exist to fund population growth” I would argue that businesses share responsibilities as members of the commonwealth. In a sense, we all need to fund the growth and well-being of our children.

I know it's tough, I've run a couple of tech startups myself.

But in my experience, I'd rather go out of business than pay a woman less than a man doing a similar job. By the same token, if I could afford it, I'd be proud to know that I'd helped plant a seed in some small way by supporting a female employee through her maternity leave.

chrisbeach

If you're writing this from a mother's point of view then I can understand why you might think the way you do. However, businesses don't exist to fund population growth.

In fact neither should the government. I believe the various benefits enjoyed by mothers, particularly those with multiple children, are ALREADY an affront to hard-working taxpayers, many of which do not have or want children.

Mothers should take some responsibility for themselves and understand it's not up to society to fund their procreation. If they can't afford to have children, they should not have children. Simple as that.

I think there are two possible planes on which to respond to the problem you have outlined. One is the uncompromising “but it SHOULDN'T make you discriminate” stance. This carries the implication that the problem you're facing is your own attitude problem and there's simply no justification for considering the economic impact of a pregnant woman on your business – any more than there would be if you were discriminating racially.

I find this plane admirable because it's idealistic and a lot of political people are idealistic, which is just as well (if you think politics is screwed up now, just think about how screwed up it would get if you took away all the people prepared to scream on the internet in defence of a pure principle).

However, it's the other plane, the “harsh economic realities” one, that I think has the answer in this case. If you are being incentivised to follow a course of action that may be detrimental to a woman's success, and which also causes you moral trouble, then the answer is surely to ask why the incentives are set up in such a godawful way. Rather than extending maternity leave, I would favour extending it as *parental* leave and making it exchangeable between both parents, however they like. Thus, the risk of long periods of leave notionally attaches as much to hiring a man as a woman. Net cost to employers, nil, but the existing risk is more evenly spread. Needless to say, it's also *more* socially liberal than maternity leave.

Now, of course the incentives would not immediately shake out evenly because of some still pretty powerful fixed gender roles. But I think it has the potential to unleash some quite dramatic change. Anecdotally, a fair few wealthy dads who can afford to currently arrange this for themselves by taking a sabbatical or a career break, so there must be at least some existing pent-up demand.

Really interesting post. I think the solution requires looking at the problem from a different angle.

If I had to pen a maternity law it would go something like this.

Given that:

– Mothers are ultra important to society and completely undervalued– The salaries of mothers should be the responsibility of society as a whole– Employees need defending and supporting but companies fail and struggle and this should be framed in labour legislation– Smart, properly socialised children require healthy, happy parents

Producing children is hard work (well, except the first few minutes) and should be recognised as vitally important to a civilisation. In fact, child rearing is like national service or jury duty. It is one of those things we should all have to do for the benefit of our commonwealth.

In short, I think maternity leave should be mandatory – mothers should be forced to take at least three years leave to look after their kids.

While on this leave, I think they should be payed 100% of whatever wage they were on when they left for child producing work. The funding for this should come from taxation. If we can pay for soldiers and prison guards then we can pay for mothers. Simple as that.

Right-ho so that's the legislation bit, I'll let you work out the budget structure:-)

All the best,Dug

chrisbeach

Nicholas's argument is logical, and it's hard to disagree. I'd prefer to have a mixed-gender working environment, but maternity leave is costly to a firm. Businesses exist only to make money. The left-wing amongst us will say employers have a social responsibility, but I firmly believe in businesses making sound decisions from their own perspective. It's up to employees to fit their needs, not vice versa.

There's a balance to be struck between establishing a meritocratic hiring strategy over a large demographic, and mitigating the risk that the maternity law poses to business.

Name

Very interesting article. I work for a small technology company. One of our senior female members of staff went on maternity leave, we replaced her with somebody else, who happened to be female, giving her a permanent contract (as opposed to for the duration of the maternity leave). The replacement notified us that she was pregnant within 2 weeks of starting her position. I have a 12 month old daughter so I don't underestimate the value of maternity leave but as an employer it is a bitter pill to swallow, and difficult to take the moral high ground when it is seriously affecting your business.

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